Bloomberg : Nuclear Exit May Boost Power Prices 30%

The permanent halt of eight reactors and the closure of theremaining plants by 2018 could boost wholesale power prices to70 euros ($102) a megawatt-hour that year, according to a studycommissioned by the BDI and published April 24 on its website. Germany, Europe’s biggest economy and largest energy user,plans to exit nuclear power after explosions at Japanesereactors stoked safety concerns. Higher prices could threatenchemical- and metal producers while utilities lose plants thatcan be more profitable than fossil-fuel-fired units, RWE AG, thecountry’s second-largest energy supplier, said last week. The exit would generate additional costs of 33 billioneuros by 2020, of which industrial and commercial energy userswill pay 24 billion euros, as utilities employ more expensivepower generation and demand for carbon-dioxide emission permitsrises, the BDI said. The figure would rise to 51 billion eurosif subsidies for developing renewable energy and the Germanpower grid are included, the lobby group said on its website. German Chancellor Angela Merkel said April 15 that she willput plans to boost renewable energy output, build power gridsand phase out nuclear electricity to Cabinet in June. She hasn’tspecified a date for the exit. The study assumes that 50 percent of the output shortfallfrom Germany’s reactors will be plugged in the “short-term” byimports and the remainder by coal- and natural-gas-firedgenerators. That would raise the energy industry’s CO2 emissionsto 282 million metric tons in 2018, 28 percent more than theGerman government had planned, the BDI said. The study was conducted by r2b energy consulting GmbH, aCologne, Germany-based company that provides advice to theenergy industry, energy users and political institutions,according to its website.